Gas Industry In China Research Articles

Several essential geological and geochemical issues regarding shale gas research in China

Recently, shale gas research and industrial production in China have been significantly developed, which has enriched the theory of natural gas geology in China and increased the supply of domestic natural gas production. In the future, shale gas will obtain great achievements among the developments of the natural gas industry in China. The following four geological and geochemical issues about the exploration and research of shale gas have great significance: (1) China has to break through the single economic shale gas formation. The United States found at least thirty sets of economic shale gas formations in 29 basins. To date, only one basin in China (Sichuan Basin) has found one set of economic shale gas formation (Wufeng-Longmaxi formations). (2) In regards to the interval RO value of the economic shale gas formations and segment RO value of the gas fields, the interval RO values are 3.31% for the economic shale gas formation in China. However, it is 4.1% for that in the USA. The segment RO values are 2.34% for the gas fields in China and 3.5% for that in the USA. So the values are small in China, but big in the USA. Several shale gas fields derived from sapropelic sources in the United States were found in the oil generation window with RO = 1.0%–1.3%. Therefore, shale gas exploration in China also needs to pay attention to this stage. At the same time, attention should be paid to the exploration of shale gas derived from humic sources. (3) When it comes to the continuous high-yield period of the gas field, the world's first commercially developed shale gas field (Barnett) shows a high-yield forecast of 10 × 109 m3 per year for about twenty years. The development of the shale gas field in China is still in the construction stage. (4) In terms of the role of fracture in shale gas preservation and development, the fault has a dual effect on the enrichment of shale gas. In the United States, tectonic in the shale gas basin is stable, and faults are few, while structures in China in the shale gas basin are active, and faults are developed. Therefore, faults have more harm than good to the shale gas in China, which caused the fragmentation of the continuously distributed Wufeng-Longmaxi formations, limiting the area of the gas field.

Natural gas measurement technology system and its prospect in China

Natural gas measurement is an important basic job in national, social and economic development, and accurate and reliable measurement is an important guarantee for promoting the rapid development of natural gas industry in China. In this paper, the importance and characteristics of natural gas measurement were analyzed. Then, domestic and foreign natural gas measurement technologies were analyzed and compared from the aspects of measurement technological standard system, measuring instrument application technology, custody transfer metering mode in natural gas trade, measurement value traceability system and measurement management. Finally, the development of domestic natural gas flow metering technologies was summarized and predicted. And the following research results were obtained. First, natural gas measurement is a kind of large-quantity dynamic gas measurement with compressible medium, and the measurement result is derived from the flow rate, composition, temperature, pressure and other data under working conditions. Therefore, the accuracy of the measurement results cannot be guaranteed unless each basic data is measured accurately. Second, a natural gas measurement technology system has been established in China, including measurement laws and regulations, measurement technological standards and specifications, measurement value traceability technology, measuring tool application technology and measurement management system. Third, with the high-quality rapid development of domestic natural gas industry, China's natural gas measurement technology system will get improved continuously and be in line with international standards further. The guarantee for the reliability of measuring instrument may be transformed from compulsory verification to traceability based on verification or calibration, and the nationalization process of measuring tools will be sped up. In addition, the metering mode in natural gas trade will be changed greatly from volume measurement to energy measurement. In conclusion, China's natural gas measurement technology system basically guarantees the rapid development of its natural gas industry, but it still needs further improvement and completion.

Bio-natural gas industry in China: Current status and development

China has promoted its biogas industry for a long time and begun to support bio-natural gas (BNG; also known as biogas upgrading or biogas-to-biomethane) projects for the first time in 2015 at the central government level. This study presented a comprehensive overview of the BNG industry in China, including its status quo, national strategic planning, upgrading technologies, investment cost, potential, and opportunities and challenges. A total of 65 BNG demonstration projects were approved by the central government between 2015 and 2017, and 197 projects are expected to have been built by 2020 as part of the 13th Five-Year Plan (2016–2020). BNG is an emerging industry, and its development provides several opportunities, including a huge natural gas demand, national policy incentives, integrated agriculture, and reduced carbon emissions. The challenges and barriers to such developments include the high upgrading cost, fluctuating natural gas prices, unsound market access mechanism for biomethane and biofertilizer, scarce competition-oriented feedstock resources, incomplete standard system and cross-sectorial management, imperfect policy and subsidy mechanism, and lagging technology and equipment. China can learn from other developed countries in four ways. First, the country must enhance the cost effectiveness of its subsidies. Then, China must highlight the operations of its BNG industry and evaluate its performance; prioritize digestate management in the planning stage; improve its project service level and reinforce research and development. The findings of this work provide a valuable reference for other developing countries that intend to address energy shortage issues and integrate waste management into their regional planning.

Would environmental regulation improve the greenhouse gas benefits of natural gas use? A Chinese case study

Abstract Along with rapidly increasing natural gas consumption and carbon dioxide (CO2) levels and the gradually strengthening environmental regulation, further investigation of the emission-natural gas-environmental regulation nexus in China is particularly useful for mitigating the country's CO2 emissions. To empirically investigate whether environmental regulation improves the greenhouse gas benefits of natural gas use in China, this study investigates the causal relationships among CO2 emissions, natural gas consumption, and environmental regulation in China, based on panel data of China's 30 provinces covering 2005–2015. Fully considering the potential cross-sectional dependence, the system general method of moments (SYS-GMM) estimation method is utilized. The empirical results reveal that: (1) Environmental Kuznets curve (EKC) hypothesis for CO2 emissions is valid in China; (2) environmental regulation will not only directly affect CO2 emissions, but also indirectly affect CO2 emissions by influencing the energy consumption structure; (3) environmental regulation cannot significantly improve the greenhouse gas benefits of natural gas use, as environmental regulation in China can indirectly reduce CO2 emissions by decreasing coal consumption rather than increasing natural gas consumption; and (4) the causality analysis for three regions confirms the existence of significant regional differences. These findings offer several targeted policies for reducing CO2 emissions and promoting growth in the natural gas industry in China.

Underground coal gasification and its strategic significance to the development of natural gas industry in China

Abstract Based on the present situation and trend of underground coal gasification in China and overseas, this article puts forward the basic concept, mechanism and mode of underground coal gasification, and presents the challenges, development potential and development path now faced. In China, underground coal gasification which is in accord with the clean utilization of coal can produce “artificial gas”, which provides a new strategic approach to supply methane and hydrogen with Chinese characteristics before new energy sources offer large-scale supply. Coal measure strata in oil-bearing basins are developed in China, with 3.77 trillion tons coal reserves for the buried depth of 1 000−3 000 m. It is initially expected that the amount of natural gas resources from underground coal gasification to be 272−332 trillion cubic meters, which are about triple the sum of conventional natural gas, or equivalent to the total unconventional natural gas resources. According to the differences of coal reaction mechanism and product composition of underground coal gasification, the underground coal gasification can be divided into three development modes, hydrogen-rich in shallow, methane-rich in medium and deep, supercritical hydrogen-rich in deep. Beyond the scope of underground mining of coal enterprises, petroleum and petrochemical enterprises can take their own integration advantages of technologies, pipeline, market and so on, to develop underground coal gasification business based on their different needs and technical maturity, to effectively exploit a large amount of coal resources cleanly and to alleviate the tight supply of natural gas. It can also be combined with using the produced hydrogen in nearby area and the CO2 flooding and storage in adjacent oil areas to create a demonstration zone for net zero emissions of petroleum and petrochemical recycling economy. It is significant for reserving resources and technologies for the coming “hydrogen economy” era, and opening up a new path for China’s “clean, low carbon, safe and efficient” modern energy system construction.

Heavy metal pollution of oil-based drill cuttings at a shale gas drilling field in Chongqing, China: A human health risk assessment for the workers

With the flourish of shale gas industry in China, the characteristic hazardous waste, oil-based drill cuttings (OBDC), was also produced in large quantities. Unlike traditional petroleum industry, shale gas exploitation covers a wider area and there are more well sites, the adverse effects of OBDC piled up around well sites are even greater. This study investigated the pollution status and leaching toxicity of eight heavy metals (Cd, Cr, Cu, Hg, Mn, Ni, Pb and Zn) in OBDC of shale gas exploitation, and evaluated the health risks of the drilling workers. The results showed that heavy metal pollution in OBDC was moderate, and the leaching toxicity was far below the standard value. Non-carcinogenic and carcinogenic risks of drilling workers were within an acceptable range. Meanwhile, in order to reduce the health risks of drilling workers, some suggestions are proposed to reduce the exposure risks of workers and the content of heavy metals in OBDC.

Establishment of coal-derived gas geological theory and its strategic significance to the development of natural gas industry in China

Establishment of coal-derived gas geological theory and its strategic significance to the development of natural gas industry in China

Challenges to and proposals for underground gas storage (UGS) business in China

Underground gas storage (UGS) is one of the major storage and peak-shaving means in the world among numerous storage ways via gas fields, small-scale LNG, etc. With the rapid development of natural gas industry in China, the seasonal peak-shaving issues are increasingly prominent, so how to achieve sustainable development of UGS business has become a major problem at present. In view of this, we studied the present status and trend of UGS development abroad and analyzed the following challenges encountered by UGS in China. (1) UGS construction falls behind the world and peak-shaving capacity is insufficient. (2) There is lack of quality gas sources for storage and the complicated geological conditions make the cost of UGS construction high. (3) UGS construction is still at the preliminary stage, so experience is not enough in safety and scientific operation and management. (4) UGS construction, management and operation are not unified as a whole, so its maximum efficiency fails to be exerted. (5) The economic benefit of UGS is difficult to be shown without independent cost accounting. Based on the experience of other countries, some proposals were put forward on UGS development under the actual present situation: to strengthen strategic UGS layout, intensify storage site screening in key areas and steadily promote UGS construction; to establish professional UGS technical and management teams and intensify the research of key technologies; and to set up a complete and rationally-distributed UGS construction, operation and management system.

A System Dynamics Analysis of Investment, Technology and Policy that Affect Natural Gas Exploration and Exploitation in China

Natural gas has an increasing role in Chinese energy transformation. We present a system dynamics model of the natural gas industry in China. A new system dynamics model for natural gas companies based on reserve exploration and well construction as well as investment dynamics is proposed. The contribution of the paper is to analyze the influence of technology, investment and policy factors on the natural gas industry. We found that the dynamics of the main variables, including gas policy, cost of investment, accounting depreciation and exploitation technology, are sensitive to the sustainable development of resources. The simulations and results presented here will be helpful for government to reform policies, and for upstream companies to make decisions.

Natural gas price effects in China based on the CGE model

Natural gas is a clean energy source with many benefits and its proportion in the energy consumption structure in China has been gradually increasing over the recent years. Since the price of natural gas in China has been controlled and maintained at a relatively low level by the government, reforming the natural gas industry in China has been the matter of much attention in light of its macroeconomic effects on the overall economy. Using the Computable General Equilibrium model and the 2012 Social Accounting Matrix, the results show increases in natural gas prices lead to an increase in the consumer price index (CPI) and lead to reductions in GDP. The chemical industry sector is strongly influenced by a natural gas price increase. Furthermore, chemical fertilizer manufacturing industry and chemical products’ manufacturing have very significant effects in China. Therefore the government may gradually establish and improve the management of natural gas price to avoid negative effects, and implement a differential price as the industries exhibit different levels of resistance in response to natural gas price changes.

Economic evaluation on tight sandstone gas development projects in China and recommendation on fiscal and taxation support policies

China is rich in tight sandstone gas resources (“tight gas” for short). For example, the Sulige Gasfield in the Ordos Basin and the Upper Triassic Xujiahe Fm gas reservoir in the Sichuan Basin are typical tight gas reservoirs. In the past decade, tight gas reserve and production both have increased rapidly in China, but tight gas reservoirs are always managed as conventional gas reservoirs without effective fiscal, taxation and policy supports. The potential of sustainable tight gas production increase is obviously restricted. The tight gas development projects represented by the Sulige Gasfield have failed to make profit for a long period, and especially tight gas production has presented a slight decline since 2015. In this paper, a new economic evaluation method was proposed for tight gas development projects. The new method was designed to verify the key parameters (e.g. production decline rate and single-well economic service life) depending on tight gas development and production characteristics, and perform the depreciation by using the production method. Furthermore, the possibility that the operation cost may rise due to pressure-boosting production and intermittent opening of gas wells is considered. The method was used for the tight gas development project of Sulige Gasfield, showing that its profit level is much lower than the enterprise's cost level of capital. In order to support a sustainable development of tight gas industry in China, it is recommended that relevant authorities issue value-added tax (VAT) refund policy as soon as possible. It is necessary to restore the non-resident gas gate price of the provinces where tight gas is produced to the fair and reasonable level in addition to the fiscal subsidy of CNY0.24/m3, or offer the fiscal subsidy of CNY0.32/m3 directly based on the on-going gate price. With these support policies, tax income is expected to rise directly, fiscal expenditure will not increase, and gas consumption cost in China will be significantly cut down.

Recommendations on Improving Fiscal and Taxation Policies of Shale Gas Industry in China

With the rapid development of economy and the sharp increase of population, energy consumption is increasing and fossil energy reserves are decreasing. It has become an urgent problem to be solved by all the countries that seek for clean and renewable energy. Natural gas is a kind of environment-friendly energy, but conventional natural gas production cannot completely meet the growing demand of natural gas consumption. Shale gas, as a kind of unconventional natural gas, is very rich in our country, which makes the development and utilization of natural gas enter an important field. Therefore, this paper introduces the development situation of shale gas industry in our country and the advantages and disadvantages of the development and utilization of shale gas, and finally discusses the fiscal and taxation policy suitable for the development of shale gas industry in our country by drawing on the successful experience of shale gas development in the USA.

Strategies for the development of CBM gas industry in China

Since the environment for the CBM development in China has been changing in recent years, it is necessary to re-consider the relevant strategies. Through investigations, surveys, geologic assessment, strategic decision-making and other techniques, the strategies for CBM development in China were discussed in respect to present situations, opportunities, challenges, proved reserves, producing reserves, strategic principles, strategic countermeasures, time-spatial allocation of strategies, risk assessments, and elimination of relevant risks. Some research results were obtained. Firstly, still in its initial development stage with fast growth, the CBM industry in China has made outstanding achievements in six aspects and also faces challenges in six aspects. Secondly, strategic focus can be summarized as constructing six CBM production bases in Qinshui, Eastern margin of Ordos Basin, Southwest China, Changqing, Northwest China, and Northeast China, respectively, according to the principles of “steadily developing middle-high rank coals, accelerating the development of low-rank coals and strengthening the comprehensive utilization of mining gas wells”. It is expected that the producing reserves and peak-production rate will be 3–4 trillion m3 and 35–45 billion m3/a, respectively. Thirdly, major strategic risks in CBM development in China include low productivities of individual wells, improper understandings of geologic conditions, decline in investments and lack of technical reserves. To eliminate these risks, it is necessary to reinforce work in the following five aspects, namely, strengthening comprehensive exploration and development of coal-bearing formations, creating favorable environments for the development of private oil companies, expanding spaces for the growth of technical service companies, conducting more researches for the development of innovative technologies in more areas and intensifying law enforcement.

The Development Situation Analysis and Outlook of the Chinese Shale Gas Industry

Influenced by the shale gas revolution in the U.S and outstanding contradiction between natural gas supply and demand on the domestic market, China gives top priority to shale gas development and utilization. Remarkable progress has been made in shale gas exploitation, technology and international cooperation since 2009. However, shale gas industry in China still faces many daunting problems such as imperfect mining right exit mechanism, environmental risk, immature technology, etc. Based on the successful experience of the U.S. shale gas development and lessons from China's sluggish growth of coalbed methane gas, countermeasures proposed in this paper are summarized as follows: making overall planning for shale gas development, perfecting mining right exit mechanism and solving the overlapping mineral rights issue, promoting technology research, strengthening environmental regulation of shale gas, and promoting the construction of shale gas supporting infrastructure.

Trends in high performance compressors for petrochemical and natural gas industry in China

Compressors are the key equipment in the petrochemical and natural gas industry system. The performance and reliability of them are very important for the process system. The application status of petrochemical & natural gas compressors in China is presented in this paper. The present status of design and operating technologies of compressors in China are mentioned in this paper. The turbo, reciprocating and twin screw compressors are discussed. The market demands for different structure compressors in process gas industries are analysed. This paper also introduces the research and developments for high performance compressors in China. The recent research results on efficiency improvement methods, stability improvement, online monitor and fault diagnosis will also be presented in details.

Sustainability Assessment of the Natural Gas Industry in China Using Principal Component Analysis

Under pressure toward carbon emission reduction and air protection, China has accelerated energy restructuring by greatly improving the supply and consumption of natural gas in recent years. However, several issues with the sustainable development of the natural gas industry in China still need in-depth discussion. Therefore, based on the fundamental ideas of sustainable development, industrial development theories and features of the natural gas industry, a sustainable development theory is proposed in this thesis. The theory consists of five parts: resource, market, enterprise, technology and policy. The five parts, which unite for mutual connection and promotion, push the gas industry’s development forward together. Furthermore, based on the theoretical structure, the Natural Gas Industry Sustainability Index in China is established and evaluated via the Principal Component Analysis (PCA) method. Finally, a conclusion is reached: that the sustainability of the natural gas industry in China kept rising from 2008 to 2013, mainly benefiting from increasing supply and demand, the enhancement of enterprise profits, technological innovation, policy support and the optimization and reformation of the gas market.

Exploring the future of shale gas in China from an economic perspective based on pilot areas in the Sichuan basin–A scenario analysis

Although there have been discussions regarding the commercial prospect of shale gas in China, no quantitative and convincing analysis regarding its economic viability has been reported. This research aims to explore the future of the shale gas industry in China using a single-well model. This model is established with the DCF (Discounted cash flow) method aiming at getting an average or representative reflection of the economic viability of shale gas. In the model based on data mainly from pilot areas in Sichuan Basin, three scenarios are conducted to discuss the current economy, the short-term prospect, and the future of the shale gas industry. Under the current technological and economic conditions, China's shale gas resources are not worth an investment. However, in the near future, several sweet-spots are promising, particularly with the expectation of higher gas prices and lower drilling and completion costs (D&C costs). Although the sweet-spots are promising, it is difficult to achieve the goal of large-scale development according to the known information if mainly relying on current policy, unless there are sufficient sweet-spots. Hence, we hold a cautiously optimistic attitude towards the future of the shale gas industry. We suggest that the government should spend more on supporting resource surveys and exploration in the initial stages. After identifying the resource status, a more comprehensive development plan with systemic policies conformed to the resource status is warranted, including encouragement of technical innovations, a system for mature shale gas technical service markets, and a market-oriented price.

页岩气开发的投资风险及对策研究

页岩气是当前投资领域的一个热点，它能缓解能源紧张的局面。本文首先阐述了页岩气的概念及其研究背景，然后分析了页岩气勘探和开发利用中的投资风险，并针对各类风险提出政策建议，以促进我国页岩气产业的健康发展。 Shale gas is a hot spot for investment as it alleviates the problems in energy supply. This article explains the concepts and background related to shale gas, and analyzes the investment risks in shale gas exploration and production. Policies are also suggested to promote the healthy devel-opment of the shale gas industry in China.

Natural gas supply-demand situation and prospect in China

Since the 21st century, the reserves of conventional natural gas as well as tight gas in China have been decreasing and their annual production growth rates have been generally reduced from double-digit to one-digit number of percentage. It is predicted that natural gas production will possibly reach up to 134 billion m3 in 2015; and if the marketable rate is 90%, the gas supply volume will probably be 120.6 billion m3 in 2015. Since shale gas development just has started currently, about 0.6 billion m3 of the marketable shale gas will be added to gas supply in 2015. The CBM gas production especially such gas consumption has long been lagged behind the expected targets, and what's more, flaws exist in their statistics; on this basis, it is assumed that the marketable CBM gas will be 4 billion Nm 3 in 2015. With so many achievements made in the coal gas exploitation, it is forecasted that about 5.5 billion m3 coal gas will be added to gas supply in 2015. In total, the domestic fuel gas supply is roughly estimated to be 131 billion m3 in 2015; if the gas consumption in the year is presumably 231 billion m3, about 100 billion m3 gas will then be imported in 2015. From the presumable actual imports of piped gas and LNG terminals, there is still a gap of 27–30 billion m3 in 2015. Therefore, it is suggested that more LNG receiving terminals be put into production in advance and the increment of import gas be needed from Middle Asia. Also, it is proposed that the statistics be completed on the practical marketable fuel gas quantity in the fundamental study of energy planning in the National 13th Five-Year Plan. In conclusion, the economic system reform process is the key to the further development of oil and gas industry in China.

China's 'Long March' to shale gas production-exciting potential and lost opportunities

The Chinese authorities have great hopes for the fledgling shale gas industry in China. However, while China is widely acknowledged to have abundant shale gas reserves, it would likely be difficult for China to realize these lofty ambitions, at least in the near future. China has issued encouraging policy statements to support the shale gas industry, as well as announced a number of discrete financial incentives. However, its shale gas industry faces technical challenges as well as a critical lack of detailed regulations regarding the exploration for and the production of shale gas in China. There is also a lack of guidance over the manner in which foreign investments can be made in the Chinese shale gas industry; significantly, the tussle between the ‘production sharing contract’ model and the ‘joint venture model’ still remains to be resolved. There are steps that China can take to address the hitherto lost opportunities to realize its exciting shale gas potential, the most important of which is to put in place appropriate clear and detailed regulations which are administered by a clear regulatory structure.